provisions hereof, and any party coming in in any special case shall become subject to the restrictive provisions hereof.

2. THIS Agreement relates to all loans and advances for railway purposes to be floated out of the Chinese Empire which may be made with the Chinese Imperial Government and/or with Government Departments and Companies having Chinese Imperial or Provincial Government guarantees but does not relate to loans to be floated within the Chinese Empire nor to any loans in connection with the Hankow-Canton and Hankow-Chengtu Railways.

3.-ANY business of the kind hereinbefore defined to which the Agreement relates which may be offered to any of the contracting parties of the first third fourth and fifth parts (hereinafter jointly referred to as "the lenders ") must be dealt with jointly by them in accordance with the stipulations of this Agreement. 4. AS regards joint action in respect of financial operations for railway purposes not having such guarantees special Agreements will have to be made. in each separate case.

5. THIS Agreement is made on the principle of equality namely equal terms in every respect between the lenders and each of the lenders enters into this Agreement for their respective groups and shall take an equal share in all operations and jointly sign all contracts except as hereinafter provided and shall bear in equal shares all charges in connection with any business (except stamp duties and any charges of and connected with the realisation by each of the lenders in their respective markets of their participation in the operations) and conclude all contracts with equal rights and obligations as between themselves PROVIDED ALWAYS that in cases where the introduction of third parties is calculated to prejudice the success of the negotiations any business falling within the scope of this Agreement may be entertained and negotiations entered upon by any one of the lenders alone but with notice to be given to the other lenders as soon as possible and should it appear in the course of such negotiations that the conditions imposed upon the business preclude joint negotiations and/or joint signatures by the lenders in terms of this Agreement the negotiating party may if mutually agreed upon by the lenders conclude the negotiations and sign the Agreement alone but upon the terms of the other lenders being entitled to all rights or participation under this Agreement other than those involving or arising from joint negotiation and joint signature but it is understood that all the lenders will use their best endeavors to obtain the joint signatures to any contract except where by mutual consent of those lenders who are prepared to participate this is found to be impracticable when the party signing the contract shall by the insertion of a special clause or execution of a separate declaration of trust or otherwise ensure to the other lenders the same rights as regards the taking over the issue and service of the loan which it has obtained under the contract for itself and also the authority required for obtaining official quotations in the respective markets of the said other parties.

6.-ALL contracts shall so far as possible be made so as not to impose joint liability on the lenders, but each of the parties to the said contracts shall severally liquidate its own engagements and liabilities towards the party of the other side in China. The parties to the said contracts will so far as possible come to an

understanding with regard to the realization of the operations but so that such realization in whatever manner this may take place shall be for the separate benefit of each of the lenders as regards their respective participations therein.

7.-IN the event of any of the lenders declining a participation in any business proposed either at the outset or at any time during the course of the negotiations the other lenders shall have the option of taking up and carrying out the business either jointly or if only one takes up the business separately on their or its respective accounts and in their or its respective markets without prejudice to the provisions of this Agreement.

8. THE lenders will endeavor to secure in their respective markets a successful issue of any loan the subject-matter of contracts entered into with them jointly or in which they may be jointly interested.

9.-SUBJECT to the provisions of the Agreement referred to in paragraph 14 hereof any participation given in its own market by any one of the lenders shall be for its own account only but any participations given by and in the mutual interest of all the lenders who may be parties to or interested in any contract to any banks or banking firms outside of England France Germany and America respectively shall be borne in equal shares by the parties interested.

10.-ALL offers shall be made to the Chinese Authorities and loans accepted on terms of control which involve as a minimum :

(A) The appointment of Engineers in Chief to be approved by the lenders or lender taking a participation in the business and the Chinese to be required to make appointments approved by such lenders or lender alternately according to the order of the parties to this Agreement except where the interest of any other group can be shown to predominate and in that case the Engineer shall be appointed by that Group.

(B) Until actually required for construction proceeds of Loans to remain under the control of such lenders on terms not less favorable to the lenders than are contained in the Hukuang Loan Agreement initialled Sixth June One Thousand nine hundred and nine and in the corresponding official despatch.†

(C) Provision for proper account keeping and financial control under the direction of a Chief Accountant to be approved by such lenders or lender.

11. THE orders for materials required for any railway as far as possible. shall be equally divided between the lenders or lender participating and the commission receivable from the Chinese on such purchases after provision for the expenses of earning such commission is to be shared between the lenders or lender participating equally or as may be arranged.

12.—THE Central Company consents to be bound by the terms of this Agreement to the extent of giving effect thereto by granting to each of them the German Company and the American group one fourth interest in all loans for railway purposes obtained by it in connection with any part of the Chinese Empire north of the Yangtse River and the German Company and the American Group each agrees to grant to the other of them one-fourth interest in any loans for Railway purposes secured by it in the said area and also agrees to grant to the

Quoted in note to final agreement for Hukuang Railway Loan, May 20, 1911 (No. 1911/5), p. 880, post.

Central Company one-half interest in any loans for railway purposes secured by it in the said area and the granting of such interests to the Central Company is hereby accepted by the Corporation and the French Bank as in satisfaction of all rights under this Agreement to participation in such loans. The Central Company not being comprised in the lenders as per Article 3 shall in their negotiations with the Chinese Authorities nevertheless be bound by Clause 10 of the present Agreement.

13.—IT is distinctly understood that by the foregoing Articles 3 and 12 the German Company and the American Group shall each participate in any business of the kind defined in Article 2 of this Agreement to the extent of one-fourth share.

14.-SAVE as herein provided and as provided in an Agreement between the Hong Kong and Shanghai Banking Corporation the Deutsch-Asiatische Bank the Banque de l'Indo Chine and the American Group proposed to be entered into immediately after this Agreement no business of the kind falling within the scope of this Agreement shall be concluded or entered into either directly or indirectly by any of the parties hereto or by any of those whom they respectively represent without the consent of the others.

15.—WHERE reference is made in this Agreement to the lenders or lender taking a participation in any business such or any similar expression shall be deemed to include the American Group unless such group shall have declined its participation and notwithstanding that its participation is being issued on its account by one or more of the other parties to the Agreement mentioned in the last preceding clause hereof.

16. THE present Agreement shall remain in force until the Thirty-first December One thousand nine hundred and twelve and unless determined on that day by twelve months' previous notice given by any one of the parties to the others then until six months' notice shall be given by any one of the parties such notice to expire on the Thirtieth June or Thirty-first December in any year. Provided nevertheless that if during the continuance of the present agreement the Agreement of the Thirtieth June One thousand eight hundred and ninety-eight made between the Corporation and the Hong Kong and Shanghai Banking Corporation the terms of which have been communicated to the other parties hereto shall be determined by that Bank in pursuance of the power therein contained then the present Agreement shall forthwith upon such determination also cease and determine. Notwithstanding the termination of the present Agreement all contracts made hereunder shall continue in force for their due fulfilment until completely carried out.

IN WITNESS whereof the duly authorized representatives of the respective parties hereto have set their hands the day and year first above written.

For and on behalf of THE BANQUE DE L'INDO CHINE

S. SIMON

E. ULLMANN.

For and on behalf of THE DEUTSCH-CHINESISCHE EISENBAHN

For and on behalf of

GESELLSCHAFT m. b. H.
FR. URBIG

E. REHDERS.

Messrs. J. P. MORGAN & CO., Messrs. KUHN, LOEB & CO., THE

FIRST NATIONAL BANK and

THE NATIONAL CITY BANK,

MORGAN, GRENFELL & Co.

M. M. WARBURG & Co.

MORGAN HARJES & CO.

Note.

Under date of July 6, 1909, the British, French and German parties to this agreement had entered into a memorandum of agreement respecting loans to the Chinese Government for railway purposes, in the following terms:

Memorandum of agreement among British, French and German Groups in regard to Railway Loans, July 6, 1909.

MEMORANDUM OF AGREEMENT made the Sixth day of July, One thousand_nine hundred and nine BETWEEN THE BRITISH AND CHINESE CORPORATION, LIMITED, having its registered office at 3 Lombard Street in the City of London (hereinafter called "the Corporation") of the first part CHINESE CENTRAL RAILWAYS, LIMITED, having its registered office at 110 Cannon Street in the said City (hereinafter called "the Central Company") of the second part THE BANQUE DE L'INDO CHINE, having its office at 15bis Rue Laffitte, Paris (hereinafter called "the French Bank") of the third part and THE DEUTSCH-CHINESISCHE EISENBAHN GESELLSCHAFT m.b.H. having its office at 31 Unter den Linden, Berlin (hereinafter called "the German Company") of the fourth part WHEREAS the parties hereto have expressed their willingness to enter into a general Anglo-Franco-German understanding for the purpose ofgoverning their action in connection with the negotiations for and making to the Chinese Empire loans for railway purposes NOW IT IS HEREBY AGREED by and between the parties hereto as follows:

1.-IN the matter of this Agreement the French Bank is acting on behalf of the French Syndicate for Chinese business consisting of the parties whose names are set forth in the First Schedule hereto and the German Company is acting on behalf of the German Syndicate for Chinese business consisting of the parties whose names are set forth in the Second Schedule hereto. The French Bank and the German Company reserve to themselves the right of increasing or reducing in each special case the number of parties interested in the French and German Syndicates respectively and a similar right is reserved to the Corporation, but so that in any such case any party dropping out in any special case shall still remain bound by the restrictive provisions hereof and any party coming in in any special case shall become subject to the restrictive provisions hereof.

2. THIS Agreement relates to all loans and advances for railway purposes to be floated out of the Chinese Empire which may be made with the Chinese Imperial Government and/or with Government Departments and Companies having Chinese Imperial or Provincial Government guarantees but does not relate to loans to be floated within the Chinese Empire nor to any loans in connection with the Hankow Canton and Hankow Chengtu Railways.

3. ANY business of the kind hereinbefore defined to which this Agreement relates which may be offered to either of the contracting parties of the first, third and fourth parts (hereinafter jointly referred as "the lenders") must be dealt with jointly by them in accordance with the stipulations of this Agreement.

4.-AS regards joint action in respect of financial operations for railway purposes not having such guarantees, special Agreements will have to be made in each separate case. 5. THIS Agreement is made on the principle of equality namely equal terms in every respect between the lenders and each of the lenders enters into this Agreement for their respective groups and shall take an equal share in all operations and jointly sign all contracts except as hereinafter provided and shall bear in equal shares all charges in connection with any business (except stamp duties and any charges of and connected with the realisation by each of the lenders in their respective markets of their participation in the operations) and conclude all contracts with equal rights and obligations as between themselves PROVIDED ALWAYS that in cases where the introduction of third parties is calculated to prejudice the success of the negotiations any business falling within the scope of this Agreement may be entertained and negotiations entered upon by either of the lenders alone with or without notice to the other lenders and should it appear in the course of such negotiations that the conditions imposed upon the business preclude joint negotiations and/or joint signatures by the lenders in terms of this agreement the negotiating party may conclude the negotiations and sign the agreement alone but upon the terms of the other lenders being entitled to all rights or participation under this Agreement other than those involving or arising from joint negotiation and joint signature but it is understood that all the lenders will use their best endeavours to obtain the joint signatures to any contract wherever possible except where for any reasons this is found to be impracticable when the party signing the contract shall by the insertion of a special clause or execution of a separate declaration of trust or otherwise ensure to the other lenders the same rights as regards the taking over the issue and service of the loan which it has obtained under the contract for itself and also the authority required for obtaining official quotations in the respective markets of the said other parties.

6.-ALL contracts shall so far as possible be made so as not to impose joint liability